Marcy Ventures Partners, a philanthropic organization, received a $5 million investment from the W.K.Kellogg Foundation several years ago. The music industry’s gut-instinct culture of hit-seeking met the foundations’ strategy-driven and measurement-focused ways.
The contrasts were evident in a video interview conducted by Marcy’s Jay Brown, and Kellogg President La June Montgomery Tabron during the Mission Investors Exchange National Conference in Los Angeles last month.
Brown and Shawn Carter (better known as hip-hop icon Jay-Z) co-founded Roc Nation, a record label and talent agent. In 2018, they founded Marcy Ventures, a company with a third member Larry Marcus to “invest in Consumer & Culture, with an emphasis on positive impacts.” Kellogg Foundation made a $325 million investment in Marcy Ventures’ second fund.
Bloomberg reported after our interview that Marcy Ventures was in talks with Pendulum Holdings founded by D’Rita Robinson and Robbie Robinson (a financial advisor for Barack and Michelle Obama) to create a combined investment management firm.
Brown said, “Everything we’ve done since Roc Nation is social impact.” “That’s our stand.”
I asked Brown how Marcy knows if it is having an impact, since they back brands with a purpose, like Rihanna’s Savage X Fenty lingerie. He said that the world measures Marcy’s influence based on its reaction.
Brown continued, “My measurement would be that I’m doing my best to do the right things, and I hope everyone else is too.” “I don’t like to measure myself and other people. “I think it’s a wrong way to measure people.”
Tabron, however, said that programmatic alignment and impact measurements are key to the $340 millions in mission-driven investment that Kellogg made since 2007. ‘s $340-million mission-driven portfolio. The investment in Marcy Ventures aimed to drive job growth, culture shifts, and expanded representation of people from color in venture capital fund managers.
Tabron said, “We continue to track and understand impact because I think this is what others need to join us.”
Marcy Ventures, according to the Kellogg Foundation, has created a pathway for investing in cultural trends and consumer trends that protects the interests of communities.
“We can see the social impact even in the narrative space.” Tabron said, “We know that authentic stories as well as people who are able to relate culturally with people of different cultures will eventually lead to racial justice and healing,” Tabron said. “Everything that we invest in has a social return.”
Mission Alignment
Brown cited Marcy Ventures as a source of wealth creation and job creation, as well training programs for young investors. Merit Beauty, Our Place, Babylist, and other brands are among the brands Marcy Ventures supports. The first fund’s portfolio is composed of 60% women-led companies and entrepreneurs of color. The firm has an impressive track record of investing into successful media and culture companies that reach communities.
“We don’t buy culture. We create culture. “That’s who we are,” he said. “People want to join something unique and different.”
Tabron stated that Kellogg’s mission-driven investments, valued at $160M, are managed by women and/or managers who are of color. This compares to a total of less than 2% for the entire industry. According to the foundation’s most recent impact report, the mission portfolio generated a rate of return internal of 11% from 2017-2021.
“Let’s start rebuilding this sector so that we can remove some of the barriers for access.” Tabron said that this is part of the story. “Once we demonstrate the great returns we are creating and the great industry we are creating, other will join us. “People have been leaving money on the table.”
Kellogg’s mission investments are a carving out of the foundation’s $8 billion trust fund and endowment.
Tabron said that he hoped to see mission investing in the entire portfolio. “Not just the mission investments space, but throughout our portfolio,” he added. “We must be in alignment, because we’re here to improve the life of children and their families and every dollar that we have should contribute.”
She said that the board of trustees at Kellogg Foundation is in agreement with the move to redirect the foundation’s assets towards its mission.
“When your governance structure is aligned to your mission, there is no fight,” she said. “Our board is asking us: ‘What can you do more?'”